At the end of 2015, many experts predicted that Canada's national housing market will slowdown in 2016 however a more recent report has stated that the future is still promising for the real estate market in Canada. According to Barbara Yaffe of Vancouver Sun, more people are expected to rent, more buyers will prefer suburban areas and more foreign investors are expected to come in.
And what is happening in Canada's housing market contradicts last year's predictions. Instead of a slowdown, Toronto and Vancouver, the two largest markets, are seeing strong demand in housing which drives sales and prices up. According to Globe and Mail, it offsets the decline in some parts of the country that have been hit by declining oil prices. Housing remains a bright spot in real estate for Canada.
Surprisingly, Canadian housing starts dropped more than it was projected in December from November 2015. Amidst looming fears of oversupply of housing units in 2016, construction of multiple units, such as condominiums, fell sharply as reported by the national housing agency on Monday.
According to the Canadian Mortgage and Housing Corp, the seasonally adjusted annualized rate of housing starts fell to 172,965 units in December from 212,028 units in November. That is 27,000 units short of the projected 200,000 housing starts.
Groundbreaking activities also fell. Specifically groundbreaking on multiple units dropped to 101,264 from 138,665 in November, as single detached starts remained within the same range at 57,743 units in December against 57,780 in November.
It should be noted that the data per region has a wide gap. Likewise, new developments in Ontario, which is Canada's most populated province, also greatly declined as oil prices fell, affecting the energy industry. Housing starts are still active in Quebec and British Columbia. So as a whole, national figures for housing starts increased to 195,536 units in 2015 from 189,329 units in 2014.